In This Article:
With the business potentially at an important milestone, we thought we'd take a closer look at Vintage Energy Limited's (ASX:VEN) future prospects. Vintage Energy Limited acquires, explores for, and develops oil and gas properties in Australia. On 30 June 2024, the AU$8.3m market-cap company posted a loss of AU$23m for its most recent financial year. Many investors are wondering about the rate at which Vintage Energy will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.
Check out our latest analysis for Vintage Energy
Vintage Energy is bordering on breakeven, according to some Australian Oil and Gas analysts. They expect the company to post a final loss in 2024, before turning a profit of AU$3.0m in 2025. So, the company is predicted to breakeven approximately 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 137% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
We're not going to go through company-specific developments for Vintage Energy given that this is a high-level summary, though, keep in mind that typically an energy business has lumpy cash flows which are contingent on the natural resource and stage at which the company is operating. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 29% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of Vintage Energy which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Vintage Energy, take a look at Vintage Energy's company page on Simply Wall St. We've also compiled a list of key factors you should further examine:
-
Valuation: What is Vintage Energy worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Vintage Energy is currently mispriced by the market.
-
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Vintage Energy’s board and the CEO’s background.
-
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.